FG Rules Out Fresh Taxes, Charges in Aviation

Minister of Aviation and Aerospace Development, Mr Festus Keyamo

FG Rules Out Fresh Taxes, Charges in Aviation

Minister of Aviation and Aerospace Development, Mr Festus Keyamo, yesterday said the plan to improve the revenue generation by aviation agencies was not tantamount to raising taxes and charges.

However, he said the federal government’s intention was to block leakages and optimise the revenue of the government.

Keyamo spoke during a webinar on “Repositioning the aviation sector for revenue generation and growth: Role of Legislation.”

The webinar was put together by Olisa Agbakoba Legal (OAL) with stakeholders in the aviation sector decrying the inability of the aviation sector to make significant contribution to the country’s gross domestic product (GDP).

Economic Confidential reports that there have been concerns over multiple charges and taxes paid by airlines and service providers in the aviation industry.
International Airport (MMIA) tollgate, disclosing that the airport currently generates N100m monthly.

He said investigations showed that many users of the toll gates are exempted from toll with the excuse that they are VIPs.

He said this would be stopped as all VIPs making use of the facility would now be made to pay including himself.

The minister also wooed Nigerian investors to collaborate with the ministry to deepen the growth of the sector.

Quoting data from the National Bureau of Statistics (NBS), he disclosed that the aviation sector has contributed about N117 billion which is 4% to the National GDP in the first quarter of 2022, supporting about 200,000 jobs and pays about N8.5 billion in tax annually.

He said with more collaboration and revenue blockages, the contribution can be significantly upscaled.

“I have reviewed the progress made so far vis-a-vis the existing gaps. Accordingly, we are already looking at focus areas which are encapsulated in a five-point agenda namely strict compliance with national laws and regulations; international obligations, improvement, and development of infrastructure for passenger convenience, support for the growth and sustenance of local airline businesses, and human capacity development, and optimisation of revenue generation.

“As the Minister of Aviation and Aerospace Development, I am deeply committed to this agenda. In these challenging times, characterised by evolving market dynamics and global uncertainties, the need to reposition our aviation sector for sustainable growth has never been more pressing. It requires vision, resilience, finances, and collaboration.

“I am optimistic that stakeholders participating in today’s webinar session will build on their enviable track records to come up with appropriate strategies for repositioning the aviation sector for revenue generation and growth through the instrumentality of legislation. As a government, we are committed to initiatives and policy inputs that will stimulate investment across the aviation value chain,” he said.

President of the Aircraft and Owners Pilots Association of Nigeria (AOPA), Dr Alex Nwuba, lamented that aviation’s contribution to the GDP has been abysmally low.

He also decried the state of Nigerian airlines, saying in 2007, no fewer than seven licences were withdrawn.

He said, “Nigeria is a signatory to over 90 Bilateral Air Services Agreement (BASA), most unfairly skewed against Nigerian airlines including the open skies treaty known as the Single African Air Transport Market (SAATM). BASAs entered into without adequate consideration of their impact on aviation in Nigeria.

“Over 25 foreign airlines operate flights into Nigeria. Only one Nigerian airline operates internationally. One or two Nigerian airlines operate on regional routes.”